Step by Step Guide to the Market Research Process

Summary: The market research process requires decisions related to budget, target sample, development of data collection tools, fielding, analysis, and reporting. Here is a check list to make the process easier.

5 minutes to read. By author Michaela Mora on July 28, 2011
Topics: Business Strategy, Market Research

Step by Step Market Research Process

The market research process requires making decisions at many steps that can be overwhelming for non-researchers put in charge of research projects.

I found the chance to help and share my experience when I got invited to teach a Twitterversity class under the topic “Principles of Market Research Project Management”, a Twitter-only event organized by Research Rockstar.

For those who missed it and for those who attended and want to see all the tweets I sent under the hashtag #MRXU on 7/28, in one place, here they are.

Consider the following 7 steps during the implementation of a market research project:

Step 1. Define the Research Objectives

  • This is the most important step. It sets the direction of the whole market research process.
  • Ask clients how they will use the research results, what business decisions they will make based on the data. They should be specific
  • Do some background research, interview key stakeholders, and research users to put the research objectives into a greater context
  • Get a consensus among key stakeholders on the main research objectives. Get them involved from the start
  • Avoid objective creep. Don’t try to research everything under the sky in a project. Focus on what’s needed for decision making
  • Trying to cram many things into a project because of budget constraints is often a waste of money as data quality suffers
  • Discuss limitations early in the process. Set clear expectations of what the research will cover and what data it will provide
  • Check if previous research has been conducted on the same issue to avoid effort duplication and waste of money
  • DO NOT select data collection method before establishing clear objectives and identifying the target population

Step 2. Determine the Budget

  • How much are the key stakeholders willing to invest in the requested research? Get a number!
  • If there is no commitment to a budget, you will be wasting your time (RFP) and your research vendor’s time (proposal)
  • There is always a trade-off between research quality, deadline, and cost. Make your internal clients aware of that
  • There is a limit to “better, faster and cheaper” in market research. Push it too hard and you will get fast, cheap, crappy research

Step 3. Define the Target Population for the Research

  • Who do you want to gather data from? Customers? Non-Customers? Category users?
  • Sample definition helps decide on what data collection method we use. More than one method may be needed. To read more about mixed-mode  data collection check: Mixed Data Collection Modes – Round-Up
  • Create clear screening criteria. Discuss them with key stakeholders. Make sure they align with the research objectives.
  • Discuss the caveats and limitations of the sample definition and how they will affect the results and decision making
  • Be realistic. Given your budget, you may or may not be able to reach your target population

Step 4. Design the Analytical Plan

  • Based on the decisions that will be made, determine what type of data is needed and expected
  • Select analysis techniques that help you reach the research objectives and provide data that research users are expecting
  • Example: Need to know how to price a new product before it goes to market? Conjoint Analysis may be a good fit. Check: Conjoint Analysis And Realism In Price Research
  • Example: Need to pick the product name that elicits the highest purchase intent from a list of 30? Consider MaxDiff. Check: Making the Case for MaxDiff
  • Example: Need to find new growth opportunities? Segmentation research can help to find segments with the highest potential. Check: Segmentation is Key to Success
  • Think objectives firsts, methods second. Not the other way around
  • Determine the sample size based on your tolerance for risk.  Check Sample Size Matter
  • A large sample doesn’t guarantee representativeness. Check: Does A Large Sample Size Guarantee A Representative Sample?
  • The analysis techniques selected will also influence the decision on sample size

Step 5. Select Data Collection Method (s)

  • Objectives, sample, analytical plan & cost have the highest influence on which methods we use
  • Be open to using hybrid approaches combining qualitative and quantitative data collection methods
  • Ideally, if budget permits do qualitative research before or after quantitative research
  • Consider qualitative research for exploration before quantitative and deep-diving after quantitative research
  • Consider quantitative research if a go/no go decision will be made. DO NOT make these type of decisions based only on qualitative research
  • Discuss which methods are the best fit to research the target pop. Some target groups may be difficult to reach with the same method
  • If you decide on mixed-mode surveys, be aware of potential measurement errors each mode introduces. Check: Understanding the Pros and Cons of Mixed-Mode Research
  • Once the data collection methods are selected, determine if you can do it with internal resources or need a research vendor
  • If time, staff, or lack of tools are limitations, consider outsourcing the project to an external research vendor. For more on this check: When Do You Need A Market Research Vendor?
  • If you have access to a customer database with emails, use it for studies related to customer retention goals and new product development
  • For customer acquisition, efforts use samples of non-customers in the category
  • If the study is online get bids from multiple online panels.
  • Don’t buy third-party email lists and blast them with survey invites. It is illegal (SPAM-CAN Act)
  • If you are doing surveys, put time into its design. To create surveys that gather quality data check: 10 Things to Consider in Survey Design
  • Considering focus groups? Check if it makes sense here: When Using Focus Groups Makes Sense
  • If you are doing focus groups, avoid common mistakes. To know which they are, check: Common Mistakes When Doing Focus Groups
  • Don’t forget about new online qualitative research techniques. Check: Online Qualitative Research Techniques Review

Step 6. Collect Data

  • Get involved, monitor. Do a soft launch if you are doing online surveys to catch any potential problems

Step 7. Analyze & Report

  • Keep the key objectives in mind to connect market research to business impact. Check: How To Connect Market Research To Business Impact
  • Share preliminary results with key stakeholders, discuss, check if they make sense from a practical standpoint
  • Focus on the story behind the numbers and how it supports your recommendations. Don’t do a data dump. Focus on insights